[Click eStock] "Samsung Card, Opportunity Amid Adversity... Top Preferred Financial Stock" Target Price Up

[Asia Economy Reporter Ji Yeon-jin] Kiwoom Securities announced on the 26th that it raised the target price for Samsung Card by 2,000 KRW to 50,000 KRW, citing the highest capital ratio in the industry, stable debt structure, and excellent marketing capabilities as reasons for its high potential to emerge as a leading card company. The investment opinion was presented as the top pick among financial stocks.

Seo Young-su, a researcher at Kiwoom Securities, stated, "Interest rate hikes, real estate market downturns, and strengthened government regulations are certainly negative factors for card companies," but added, "However, companies with competitiveness during crisis phases can turn crises into opportunities and transform into high-quality enterprises."

Samsung Card achieved a quarterly controlling shareholder net profit of 155.2 billion KRW this year, a 7.9% increase compared to the same period last year. Although it decreased by 3.5% compared to the previous quarter, excluding dividend income from the previous quarter, the profit growth trend continues and is evaluated as a favorable performance exceeding expectations.

Due to the favorable economic conditions and the impact of inflation, the total card usage amount increased, and with continuous market share growth, new card usage recorded a high growth rate of 18.2% compared to the same period last year. This explains why, despite the decline in merchant commission rates, the trend of increasing merchant commissions continues.

Additionally, despite high sales growth, efficient cost management kept the increase rate of selling and administrative expenses at around 0%, and by maintaining a funding structure centered on long-term debt, the rise in funding costs due to the base interest rate hike was appropriately controlled, according to researcher Seo.

He emphasized, "Contrary to concerns, stable profits are expected even during crisis phases," and added, "It is evaluated as the strongest company in the financial sector during crises."